On buying freedom, with an income tax

"It's what we pay to live in a free country."

and other non-sensical ideas

Of all the stupid notions of justification for the so-called income tax I've heard, this has to be the most idiotic of all. If Americans owed anything to anyone for having a country founded on the principals of individual Liberty and self-governance, it would be to those that stood in harms way to have it and keep it. To those past and present who have paid the ultimate price in winning Liberty. We owe nothing to any lily-livered vote-buyers in Washington D.C.

"The individual may stand upon his constitutional rights as a citizen. He is entitled to carry on his private business in his own way. His power to contract is unlimited. He owes no duty to the state or to his neighbors to divulge his business, or to open his doors to an investigation, so far as it may tend to criminate him. He owes no such duty to the state, since he receives nothing therefrom, beyond the protection of his life and property.

His rights are such as existed by the law of the land long antecedent to the organization of the state, and can only be taken from him by due process of law, and in accordance with the Constitution. Among his rights are a refusal to incriminate himself, and the immunity of himself and his property from arrest or seizure except under a warrant of the law. He owes nothing to the public as long as he does not trespass upon their rights."Hale v. Henkel, 201 U.S. 43

Exactly how does sending money to the federal government, based on what you earn by the way, not on the legitimate cost of government, pay for anyones freedom anyway?? People that produce, pay for the social programs that make others into hopeless dependents. What does that have to do with freedom?? No, the price of Liberty has little to do with money.

But, we are constantly told by our servants in Congress and others in and around federal government that our freedom creates certain "responsibilities" for us to see to, by way of sending our cash to them for re-distribution to those that they determine need it more then we do. As if they are the great providers of our freedom in the first place.

"...at the Revolution, the sovereignty devolved on the people; and they are
truly the sovereigns of the country, but they are sovereigns without subjects..
with none to govern but themselves; the citizens of America are equal as fellow
citizens, and as joint tenants in the sovereignty."
CHISHOLM v. GEORGIA (US) 2 Dall 419, 454, 1 L Ed 440, 455 @DALL 1793 pp. 471-472.

What exactly is "the responsibility of freedom"? I've heard many times that you can't have freedom without "the responsibility". It is always thrown out there as if the responsibility is to let government have whatever it is crying for in exchange for "allowing" our freedom.

It goes right along with the other stupidest of comments, "it's the price you have to pay for freedom". That line is constantly attached to any discussion of income taxes and has to be one of the all time stupidest things I have ever heard uttered by people that are at least intelligent enough to tie their own shoes and walk in a straight line.

Can you see it? The responsibility of freedom is to protect, nurture, nourish, keep, hold, excercise, and honor it. To understand, and to completely comprehend that if there be any single one person in this entire nation without right to Liberty, then we are all without Liberty. If we will not freely be bound by this reality, the true responsibility of freedom, Liberty suffers for all. My freedom and your freedom are the same, I can not restrict yours, without restricting mine. The responsibility is to hold Liberty as sacred with respect to the fact that to do otherwise is to diminish ourselves.

The responsibility is to protect freedom. To stand up to those who would seek to diminish it. To remain ever vigilante against the beast of government that would always seek to diminish our most precious of assets, Liberty. This is the never-ending job of the Sovereign individual. We can not buy our freedom from our elected representatives, nor can we abdicate our responsibilities to protect Liberty for all, and enjoy any for ourselves.

"Sovereignty itself is, of course, not subject to the law, for it is the author
and source of law, but in our system, while sovereign powers are delegated to
the agencies of government, sovereignty itself remains with the people, by whom
and for whom all government exists and acts." - "For, the very idea that one
man may be compelled to hold his life, or the means of living, or any material
right essential to the enjoyment of life, at the mere will of another, seems to
be intolerable in any country where freedom prevails, as being the essence of
slavery itself." Yick Wo v. Hopkins, Sheriff, 118 U.S. 356.

Individual Liberty is a most precious concept in any day and age, but here today in 2009 it may be even more precious as it is almost completely forgotten. The desire that all people would enjoy its blessings brought about the birth of our nation in 1776. Today's widespread ignorance of this concept enables the current decay of our society as socialists try to brainwash us with the concept of more government improves everything.

While many people today wrongly believe that we exist only at the whimsy of the temporary occupants of the White House and Congress. The real truth is still that the only authority held by these people is ours. "We the People" authorize government through our Constitution, our Sovereignty is inherent to us as a result of the unparalleled courage of our forebearers, whom we should honor by never forgetting.

The spirit of the times may alter, will alter. Our rulers will become corrupt, our people careless. A single zealot may become persecutor, and better men be his victims. It can never be too often repeated, that the time for fixing every essential right, on a legal basis, is while our rulers are honest, and ourselves united. From the conclusion of this war (revolution) we shall be going down hill. It will not then be necessary to resort every moment to the people for support. They will be forgotten, therefore, and their rights disregarded. They will forget themselves, but in the sole faculty of making money, and will never think of uniting to effect a due respect for their rights. The shackles, therefore, which shall not be knocked off at the conclusion of the war, will remain on us long, will be made heavier and heavier, till our rights shall revive or expire in a convulsion.

There are two subjects which I shall claim a right to further as long as I have breath: the public education and the subdivision of the counties into wards (townships). I consider the continuance of Republican government as absolutely hanging on these two hooks. Where every man is a sharer in the direction of his ward republic or of some of the higher ones, and feels that he is a participator in the government of affairs, not merely at an election one day in the year, but every day; when there shall not be a man in the State who shall not be a member of some one of its councils, great or small, he will let the heart be torn out of his body sooner then his power be wrested from him by a Caesar or Bonaparte.

Thomas Jefferson
©Jon D. Luman 2002

Time for another shot of common sense?

Let's face it, everybody knows that the federal government is completely out of hand and can't be trusted to tell the people the truth about anything. With the media as willing accomplices, you have to realize that everything coming from the media is just more "wag the dog", or may as well be.

So, how can you sustain your fear of government, to the point that you are immobilized?

The federal jurisdiction seems to be breaking your laws everyday, so you believe that it has that right somehow. The federal jurisdiction taxes its subjects into the ground, and you do nothing because you believe that you are one of its subjects.

You even ask it to give you back the Republic that you gave up since it has been telling you for 70 years that they replaced it with a democracy. Somehow, and some mysterious way. You are convinced that they are liars, yet you believe every word when they explain to you that you have no power, only they do.

Common sense should tell you that if they had any power, besides that which you are not using, they wouldn't need to have sycophants on TV all day long telling you how powerful they are, hear and obey, resistance is futile. What can you do?

First, stop believing the BS, start applying some common sense.

1. America is the first country in the world where authority is held by the People.

The Declaration that established that truth has never been repealed. Check it out.

2. The People chartered the federal government by authoring (authorizing) a Constitution, and with it, the People gave the federal jurisdiction limited power.

The important thing here is that the few powers that the federal jurisdiction has, come from the People. Also, the federal jurisdiction is completely within the jurisdiction of the People, not the other way around.

Of course, the federal jurisdiction is never going to tell you this, because it means that you can re-establish the Republic anytime that you want. Lucky for them that you won't believe that, and that you do believe that you need permission from them to do anything.

Your belief in their BS can hold you still long enough for them to get the chains on you that you used to have them tied up with.

The Constitution has never been repealed either, and it is obviously not broke, because the federal jurisdiction is using it to convince you that it is broke, and that is working just fine. It is only broke for those that do not know how to use it.

It is easy to learn, when you just apply a little common sense. The Liberty Letter will tell you how.

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The Federal Jurisdiction has nothing to give.

Col. David Crockett
US Representative from Tennessee

Not Yours To Give

Originally published in "The Life of Colonel David Crockett," by Edward Sylvester Ellis.

One day in the House of Representatives a bill was taken up appropriating money for the benefit of a widow of a distinguished naval officer. Several beautiful speeches had been made in its support. The speaker was just about to put the question when Crockett arose:

"Mr. Speaker--I have as much respect for the memory of the deceased, and as much sympathy for the suffering of the living, if there be, as any man in this House, but we must not permit our respect for the dead or our sympathy for part of the living to lead us into an act of injustice to the balance of the living. I will not go into an argument to prove that Congress has not the power to appropriate this money as an act of charity. Every member on this floor knows it.

We have the right as individuals, to give away as much of our own money as we please in charity; but as members of Congress we have no right to appropriate a dollar of the public money. Some eloquent appeals have been made to us upon the ground that it is a debt due the deceased. Mr. Speaker, the deceased lived long after the close of the war; he was in office to the day of his death, and I never heard that the government was in arrears to him.

"Every man in this House knows it is not a debt. We cannot without the grossest corruption, appropriate this money as the payment of a debt. We have not the semblance of authority to appropriate it as charity. Mr. Speaker, I have said we have the right to give as much money of our own as we please. I am the poorest man on this floor. I cannot vote for this bill, but I will give one week's pay to the object, and if every member of Congress will do the same, it will amount to more than the bill asks."

He took his seat. Nobody replied. The bill was put upon its passage, and, instead of passing unanimously, as was generally supposed, and as, no doubt, it would, but for that speech, it received but few votes, and, of course, was lost.
Later, when asked by a friend why he had opposed the appropriation, Crockett gave this explanation:

"Several years ago I was one evening standing on the steps of the Capitol with some members of Congress, when our attention was attracted by a great light over in Georgetown. It was evidently a large fire. We jumped into a hack and drove over as fast as we could. In spite of all that could be done, many houses were burned and many families made houseless, and besides, some of them had lost all but the clothes they had on. The weather was very cold, and when I saw so many children suffering, I felt that something ought to be done for them. The next morning a bill was introduced appropriating $20,000 for their relief. We put aside all other business and rushed it through as soon as it could be done.

"The next summer, when it began to be time to think about election, I concluded I would take a scout around among the boys of my district. I had no opposition there but, as the election was some time off, I did not know what might turn up. When riding one day in a part of my district in which I was more of a stranger than any other, I saw a man in a field plowing and coming toward the road. I gauged my gait so that we should meet as he came up, I spoke to the man. He replied politely, but as I thought, rather coldly.

"I began: 'Well friend, I am one of those unfortunate beings called candidates and---
"Yes I know you; you are Colonel Crockett. I have seen you once before, and voted for you the last time you were elected. I suppose you are out electioneering now, but you had better not waste your time or mine, I shall not vote for you again."
"This was a sockdolger...I begged him tell me what was the matter.

"Well Colonel, it is hardly worthwhile to waste time or words upon it. I do not see how it can be mended, but you gave a vote last winter which shows that either you have not capacity to understand the Constitution, or that you are wanting in the honesty and firmness to be guided by it. In either case you are not the man to represent me. But I beg your pardon for expressing it that way. I did not intend to avail myself of the privilege of the constituent to speak plainly to a candidate for the purpose of insulting you or wounding you.'

"I intend by it only to say that your understanding of the constitution is very different from mine; and I will say to you what but for my rudeness, I should not have said, that I believe you to be honest.

But an understanding of the constitution different from mine I cannot overlook, because the Constitution, to be worth anything, must be held sacred, and rigidly observed in all its provisions. The man who wields power and misinterprets it is the more dangerous the honest he is.'

" 'I admit the truth of all you say, but there must be some mistake. Though I live in the backwoods and seldom go from home, I take the papers from Washington and read very carefully all the proceedings of Congress. My papers say you voted for a bill to appropriate $20,000 to some sufferers by fire in Georgetown. Is that true?
"Well my friend; I may as well own up. You have got me there. But certainly nobody will complain that a great and rich country like ours should give the insignificant sum of $20,000 to relieve its suffering women and children, particularly with a full and overflowing treasury, and I am sure, if you had been there, you would have done just the same as I did.'

"It is not the amount, Colonel, that I complain of; it is the principle. In the first place, the government ought to have in the Treasury no more than enough for its legitimate purposes. But that has nothing with the question. The power of collecting and disbursing money at pleasure is the most dangerous power that can be entrusted to man, particularly under our system of collecting revenue by a tariff, which reaches every man in the country, no matter how poor he may be, and the poorer he is the more he pays in proportion to his means.

What is worse, it presses upon him without his knowledge where the weight centers, for there is not a man in the United States who can ever guess how much he pays to the government. So you see, that while you are contributing to relieve one, you are drawing it from thousands who are even worse off than he.

If you had the right to give anything, the amount was simply a matter of discretion with you, and you had as much right to give $20,000,000 as $20,000. If you have the right to give at all; and as the Constitution neither defines charity nor stipulates the amount, you are at liberty to give to any and everything which you may believe, or profess to believe, is a charity and to any amount you may think proper. You will very easily perceive what a wide door this would open for fraud and corruption and favoritism, on the one hand, and for robbing the people on the other. 'No, Colonel, Congress has no right to give charity.'

"'Individual members may give as much of their own money as they please, but they have no right to touch a dollar of the public money for that purpose. If twice as many houses had been burned in this country as in Georgetown, neither you nor any other member of Congress would have Thought of appropriating a dollar for our relief. There are about two hundred and forty members of Congress. If they had shown their sympathy for the sufferers by contributing each one week's pay, it would have made over $13,000. There are plenty of wealthy men around Washington who could have given $20,000 without depriving themselves of even a luxury of life.'

"The congressmen chose to keep their own money, which, if reports be true, some of them spend not very creditably; and the people about Washington, no doubt, applauded you for relieving them from necessity of giving what was not yours to give. The people have delegated to Congress, by the Constitution, the power to do certain things. To do these, it is authorized to collect and pay moneys, and for nothing else. Everything beyond this is usurpation, and a violation of the Constitution.'

"'So you see, Colonel, you have violated the Constitution in what I consider a vital point. It is a precedent fraught with danger to the country, for when Congress once begins to stretch its power beyond the limits of the Constitution, there is no limit to it, and no security for the people. I have no doubt you acted honestly, but that does not make it any better, except as far as you are personally concerned, and you see that I cannot vote for you.'

"I tell you I felt streaked. I saw if I should have opposition, and this man should go to talking and in that district I was a gone fawn-skin. I could not answer him, and the fact is, I was so fully convinced that he was right, I did not want to. But I must satisfy him, and I said to him:

"Well, my friend, you hit the nail upon the head when you said I had not sense enough to understand the Constitution. I intended to be guided by it, and thought I had studied it fully. I have heard many speeches in Congress about the powers of Congress, but what you have said here at your plow has got more hard, sound sense in it than all the fine speeches I ever heard. If I had ever taken the view of it that you have, I would have put my head into the fire before I would have given that vote; and if you will forgive me and vote for me again, if I ever vote for another unconstitutional law I wish I may be shot.'

"He laughingly replied; 'Yes, Colonel, you have sworn to that once before, but I will trust you again upon one condition. You are convinced that your vote was wrong. Your acknowledgment of it will do more good than beating you for it. If, as you go around the district, you will tell people about this vote, and that you are satisfied it was wrong, I will not only vote for you, but will do what I can to keep down opposition, and perhaps, I may exert some little influence in that way.'
"If I don't, said I, 'I wish I may be shot; and to convince you that I am in earnest in what I say I will come back this way in a week or ten days, and if you will get up a gathering of people, I will make a speech to them. Get up a barbecue, and I will pay for it.'

"No, Colonel, we are not rich people in this section but we have plenty of provisions to contribute for a barbecue, and some to spare for those who have none. The push of crops will be over in a few days, and we can then afford a day for a barbecue. 'This Thursday; I will see to getting it up on Saturday week. Come to my house on Friday, and we will go together, and I promise you a very respectable crowd to see and hear you.

"'Well I will be here. But one thing more before I say good-bye. I must know your name."

"'My name is Bunce.'
"'Not Horatio Bunce?'
"'Yes
"'Well, Mr. Bunce, I never saw you before, though you say you have seen me, but I know you very well. I am glad I have met you, and very proud that I may hope to have you for my friend.'

"It was one of the luckiest hits of my life that I met him. He mingled but little with the public, but was widely known for his remarkable intelligence, and for a heart brim-full and running over with kindness and benevolence, which showed themselves not only in words but in acts. He was the oracle of the whole country around him, and his fame had extended far beyond the circle of his immediate acquaintance. Though I had never met him, before, I had heard much of him, and but for this meeting it is very likely I should have had opposition, and had been beaten. One thing is very certain, no man could now stand up in that district under such a vote.

"At the appointed time I was at his house, having told our conversation to every crowd I had met, and to every man I stayed all night with, and I found that it gave the people an interest and confidence in me stronger than I had ever seen manifested before.

"Though I was considerably fatigued when I reached his house, and, under ordinary circumstances, should have gone early to bed, I kept him up until midnight talking about the principles and affairs of government, and got more real, true knowledge of them than I had got all my life before."

"I have known and seen much of him since, for I respect him - no, that is not the word - I reverence and love him more than any living man, and I go to see him two or three times every year; and I will tell you, sir, if every one who professes to be a Christian lived and acted and enjoyed it as he does, the religion of Christ would take the world by storm.

"But to return to my story. The next morning we went to the barbecue and, to my surprise, found about a thousand men there. I met a good many whom I had not known before, and they and my friend introduced me around until I had got pretty well acquainted - at least, they all knew me.

"In due time notice was given that I would speak to them. They gathered up around a stand that had been erected. I opened my speech by saying:

"Fellow-citizens - I present myself before you today feeling like a new man. My eyes have lately been opened to truths which ignorance or prejudice or both, had heretofore hidden from my view. I feel that I can today offer you the ability to render you more valuable service than I have ever been able to render before. I am here today more for the purpose of acknowledging my error than to seek your votes. That I should make this acknowledgment is due to myself as well as to you. Whether you will vote for me is a matter for your consideration only."

"I went on to tell them about the fire and my vote for the appropriation and then told them why I was satisfied it was wrong. I closed by saying:
"And now, fellow-citizens, it remains only for me to tell you that the most of the speech you have listened to with so much interest was simply a repetition of the arguments by which your neighbor, Mr. Bunce, convinced me of my error.

"It is the best speech I ever made in my life, but he is entitled to the credit for it. And now I hope he is satisfied with his convert and that he will get up here and tell you so.'

"He came up to the stand and said:

"Fellow-citizens - it affords me great pleasure to comply with the request of Colonel Crockett. I have always considered him a thoroughly honest man, and I am satisfied that he will faithfully perform all that he has promised you today.'
"He went down, and there went up from that crowd such a shout for Davy Crockett as his name never called forth before.'

"I am not much given to tears, but I was taken with a choking then and felt some big drops rolling down my cheeks. And I tell you now that the remembrance of those few words spoken by such a man, and the honest, hearty shout they produced, is worth more to me than all the honors I have received and all the reputation I have ever made, or ever shall make, as a member of Congress.'

"Now, sir," concluded Crockett, "you know why I made that speech yesterday. "There is one thing which I will call your attention, "you remember that I proposed to give a week's pay. There are in that House many very wealthy men - men who think nothing of spending a week's pay, or a dozen of them, for a dinner or a wine party when they have something to accomplish by it. Some of those same men made beautiful speeches upon the great debt of gratitude which the country owed the deceased--a debt which could not be paid by money--and the insignificance and worthlessness of money, particularly so insignificant a sum as $20,000 when weighed against the honor of the nation. Yet not one of them responded to my proposition. Money with them is nothing but trash when it is to come out of the people. But it is the one great thing for which most of them are striving, and many of them sacrifice honor, integrity, and justice to obtain it."

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History of the Income Tax

Before the Income Tax by G. Edward Griffin This report is adapted from two earlier articles by G. Edward Griffin appearing in the April 13, 1987 and February 29, 1988 issues of THE NEW AMERICAN. Mr. Griffin, a journalist and film producer, is the author of The Creature From Jekyll Island: A Second Look at the Federal Reserve.

It is a sobering thought that the federal government could operate - even at its current level of spending - without collecting any taxes whatsoever. All it has to do is create new money through the Federal Reserve System, a process called monetizing the debt. As a matter of fact, much of the money it now spends is obtained that way. The politicians who authorize that process know that this is not true debt, because no one in Washington really expects to repay it. It is merely a means of raising money to run the government without increasing taxes. Actually, the inflation that results from monetizing debt is just as much a tax as any other, but, because it is hidden and so few Americans understand how it works, it is far easier to collect than a tax that is out in the open.
So the question arises: Why does the federal government bother with taxes at all? Why not just operate on monetized debt? The answer is twofold. First, if it did, people would begin to wonder where the money is coming from, and that might cause them to wake up to the reality that inflation is a tax. Thus, open taxes, at some level at least, serve to perpetuate public ignorance regarding the reality of deficit spending. But the second reason is more to the point of this report. It is that taxes, particularly progressive taxes, are weapons by which social planners can wage war on one class of citizens for the benefit of another.
Tool for Social Planning
The January 1946 issue of American Affairs carried an article by Beardsley Ruml, who at the time was chairman of the Federal Reserve Bank of New York. Ruml devised the system of automatic withholding during World War II, so he was well qualified to speak on the nature and purpose of the federal income tax. His theme was spelled out in the title of his article: "Taxes for Revenue Are Obsolete."
In the introduction to the article, the magazine's editor summarized that Ruml's "thesis is that, given control of a central banking system and an incontrovertible currency [a currency not backed by gold], a sovereign national government is finally free of money worries and need no longer levy taxes for the purpose of providing itself with revenue. All taxation, therefore, should be regarded from the point of view of social and economic consequences."
Ruml explained that, since taxes are no longer needed to raise revenue for the government, there are only two purposes remaining. The first of these is to combat increases in the general price level. When people have money in their pockets they will spend it for goods and services, and this will bid up prices. The solution, wrote Ruml, is to take the money away from them and let the government spend it instead. This, too, will bid up prices, but never mind about that. Ruml explained it this way:
The dollars the government spends become purchasing power in the hands of the people who have received them. The dollars the government takes by taxes cannot be spent by the people, and therefore, these dollars can no longer be used to acquire the things which are available for sale. Taxation is, therefore, an instrument of the first importance in the administration of any fiscal and monetary policy.
The other purpose of taxation, according to Ruml, is to redistribute the wealth from one class of citizens to another. This must always be done in the name of social justice or equality, but the real objective is to override the free market and bring society under the control of the master planners. Ruml said:
The second principal purpose of federal taxes is to attain more equality of wealth and of income than would result from economic forces working alone. The taxes which are effective for this purpose are the progressive individual income tax, the progressive estate tax, and the gift tax. What these taxes should be depends on public policy with respect to the distribution of wealth and income. These taxes should be defended and attacked in terms of their effect on the character of American life, not as revenue measures.
Ruml's view will not be startling to anyone familiar with how the income tax came into existence. Beginning with the War Between the States, the Marxist philosophy of class conflict became manifest in America. Many people wrongly believe that Marxism is a battle of the poor against the rich. In reality, it is a campaign against the middle class - the class that Karl Marx called the bourgeoisie. In The Communist Manifesto, Marx wrote: "The distinguishing feature of Communism is, not the abolition of private property generally, but the abolition of bourgeois property." In order to accomplish this, he called for a "heavy progressive or graduated income tax."
Soaking the Rich?
Once this concept of class warfare had been transplanted to America, it found nourishment in the labor movement and eventually blossomed into a powerful political movement known as populism. The populists claimed that the farmers and the urban working class were being exploited by rich industrialists, largely through the unfair way in which taxes were levied. At that time, the nation's revenue was drawn primarily from internal excise taxes on the sale of such items as tobacco and liquor, and from tariffs on imports. Today, tariffs are viewed as a means of protecting jobs for American workers, but in the political debates of the 1890s they were seen as subsidies for big business, a means of protecting them from the rigors of foreign competition, thus allowing bloated profits that would not be possible without political protection. Furthermore, since these tariffs were passed along to the consumer in the form of higher prices, they were viewed as nothing but a tax levied against the little man to perpetuate the unearned profits of the rich.*
The populists advocated the elimination of tariffs and the institution in their place of a progressive income tax. The move was perceived as an act of justice and revenge. The rich, at long last, were going to be forced to pay their fair share - and more. In the House of Representatives, Congressman Thomas J. Hudson of Kansas expressed the prevailing populist sentiment: "I know that many wealthy men are generous and charitable.... On the other hand, the majority of the very wealthy are haughty, overbearing, autocratic, mean, and it is that class in particular that the income tax is designed to reach."
Yes, working, middle class Americans were in the firm majority, and any politician who promised to "soak the rich" was assured of victory at the polls. How ironic it was that those same politicians came from some of the wealthiest families in the world. Little did the common voters realize that in their greed to shift the tax burden to others, they were, in fact, placing that burden more heavily on themselves.
Our "progressive" income tax is not progressive at all. In fact, it is not even proportionate. If we had a flat-rate income tax with no exemptions or deductions, a person with 20 times the income of another would pay 20 times as much tax. By contrast, a progressive or graduated income tax may require a person with 20 times the income of another to pay considerably more than 20 times as much tax. But the way it was designed to operate is quite different. The same year that the income tax was adopted, Congress also created the tax-exempt foundation, a device whereby, under cover of charity and education, those family dynasties with great wealth can avoid paying either income tax or inheritance tax, while their fortunes remain under their control and continue to operate for their benefit.
Not far behind the super rich come the very rich, who also share in the spoils system. Over the years, the tax laws have become twisted and turned into a Gordian knot of exemptions, deductions, depreciations, shelters, and credits. Those with sufficient wealth can well afford to hire professionals to trace these convoluted paths, but the common man must be content with "standard" deductions and the crumb of a "simplified" tax return.

The federal income tax was never meant to treat all citizens alike. It will never be fair because it was designed to be unfair. Furthermore, it is difficult to imagine a tax that is more cumbersome and expensive to administer. So that each individual's income may be determined, the taxpayer must produce documentation on every aspect of his financial life. In order to assure compliance, a virtual army of agents, auditors, and computer technicians must be maintained at public expense. In the dust of this roving army are the hordes of camp followers, the accountants and tax attorneys, all of whom consume massive chunks of the national wealth without producing anything except paperwork and procedures just to measure income. In the process, every detail of our lives is recorded and made available to the bureaucracy. The right to privacy and protection against arbitrary search and seizure is trampled underfoot.
The income tax cannot be reformed. Its heart and soul are favoritism. Its muscle is political power. Its nature is waste and tyranny. It must be completely replaced.
But what should replace it? The world has been exposed to just about every kind of tax imaginable at some point in history. Nations have tried property tax, production tax, excise tax, import tax, manufacturing tax, carriage tax, window tax, chimney tax, liquor tax, tobacco tax, income tax, sales tax, value-added tax, and even a tax on death. The results have almost always been the same. The taxes become despised by the people and often lead to revolt or civil war.
Past Precedent
Fortunately, in our search for a fair tax that raises sufficient revenue, we do not have to begin from scratch. It may come as a surprise to learn that much of the work has been done and that the bulk of the plan has been drafted. Furthermore, it has actually been tested in America and found to be entirely workable. Where is this plan to be found? It is hidden where it is most unlikely to be discovered by the general public or Congress. It is in the Constitution of the United States.
After the Revolutionary War was won there was no way the colonists were going to create a new centralized government with the power to tax. They had had enough of that with England. So when the Articles of Confederation were finalized, they granted no taxing power at all. Whatever was needed had to be requested from the states, and the states were under no firm obligation to pay. Within a few years the impracticality of this arrangement was painfully obvious. The federal government had almost no funds with which to operate and, in fact, Congress did absolutely nothing for four years.
It is possible that the United States would have disintegrated into 13 separate nations with no way to protect themselves from foreign aggression had it not been for a series of tax revolts within the states. The most famous of these was Shay's Rebellion of 1786-87 in Massachusetts. In protest over excessive taxes levied by the state, a brigade of 2,000 armed insurgents blockaded the Springfield courthouse. The band was eventually dispersed by a few cannon volleys, but the incident served to dramatize the fact that none of the states was really prepared for military action on any sizable scale. The disturbance emphasized the need for a stronger central government, and a convention was called for the purpose of revising the Articles of Confederation.
Constitutional Convention
Once the convention was assembled in Philadelphia, the delegates quickly abandoned the idea of trying to revise the Articles. They were too flawed for repair. Everyone now agreed that the central government simply could not function unless it had some power of taxation. But what would that power be?
The overriding concern for all was that the new tax must act equally on the majority and the minority. Regardless of which citizens might find themselves in the majority, they must not be allowed to tax others in any way beyond what they tax themselves. There was unanimous consent on this principle.
Another principle was a direct outgrowth of the tradition of no taxation without representation. The colonists had just fought a war to establish that point. Conversely, if one has representation, then he must pay taxes. Since the whole purpose of representation was to consent - or object - to the levying of taxes, it follows that no one should have a voice in these matters who is not paying those taxes. All citizens are entitled to equal protection under the law, but only those who pay taxes shall be entitled to vote.

In an attempt to apply these broad principles of taxation, the convention delegates struggled with very practical problems. The seaboard states with extensive commercial shipping were reluctant to give up their right to collect import duties, because it was their main source of revenue. Those from the industrialized areas were fearful of taxes placed on manufacturing. Those from the agricultural provinces were hostile to land taxes. All parties were convinced that sooner or later a political majority would seize control and force them, as a potential minority, into tax servitude. After months of debate, it began to appear that the states were in hopeless deadlock. Then - many are convinced it was by divine intervention - a compromise was reached. No, it was more than a compromise. It was an absolutely brilliant plan for taxation. Unfortunately, it was never given a formal name. Those who drafted it were content merely to describe it in terms of its features. For the purposes of this report, however, we shall call it the "Uniform Apportionment Tax."

The Constitution acknowledges two kinds of taxes: direct and indirect. Direct taxes, as the name implies, are charged directly to the person who ultimately pays them. Examples of direct taxes are income and property taxes. Although they may be thought of as taxes on income or on property, remember that only people pay taxes: Money and property do not. Direct taxes, therefore, regardless of what they may be based on are charged directly to the ultimate taxpayer.
Indirect taxes, on the other hand, are levied on a commodity with the expectation that the taxes will be passed along to the consumer as part of the market price of the commodity. Examples of indirect taxes are import and excise taxes. The taxpayer always knows when he is paying a direct tax, but is often unaware of the indirect tax.
Danger of Direct Taxes

Direct taxes were viewed by the Founding Fathers as dangerous because they give government great power over its citizens and also because, in order to assess such taxes, agents must have the authority to snoop into the private lives of the citizens. They agreed, therefore, that direct taxes are safer if administered by the states, where elected representatives are closer to the people and easier to control.

Indirect taxes, on the other hand, were viewed as less dangerous, because people could avoid them if they wanted merely by not purchasing the items being taxed. This assumes the establishment of taxes only on those items that are considered nonessential, such as liquor and tobacco, often called luxury taxes. Furthermore, the process of collecting indirect taxes does not endanger the individual's right of privacy.

For these reasons, the delegates to the Constitutional Convention agreed that indirect taxes would be more appropriate for the federal government. The compromise that allowed the states "to form a more perfect union" consisted of two provisions:

1) The federal government was to derive its primary revenue from indirect taxes, and these were to be uniform in all states.

2) In the event of war or similar emergencies, the federal government, with the consent of Congress, would have authority to levy direct taxes "passed through" the states to their citizens, but these were to be proportional to the number of representatives that each state had in Congress.

This process is called apportionment. In other words, if there were 100 representatives in Congress, and the state of Virginia had seven of them, the voters in Virginia would have to pay seven percent of the direct national, emergency tax. The specific wording establishing the Uniform Apportionment Tax is found in Article I of the Constitution, and specifies:

Representatives and direct taxes shall be apportioned among the several states which may be included within this Union.... The Congress shall have power to lay and collect taxes, duties, imposts, and excises, to pay the debts and provide for the common defense and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States.... No capitation [a head tax, sometimes called a poll tax], or other direct, tax shall be laid, unless in proportion to the census or enumeration herein before directed to be taken.

A sample of the extensive historical record of the founding era demonstrates the reasoning of the men who created the concept. Alexander Hamilton, who was to become the first Secretary of the Treasury, wrote in The Federalist, #21:

Imposts, excises, and, in general, all duties upon articles of consumption, may be compared to a fluid, which will in time find its level with the means of paying them. The amount to be contributed by each citizen will in a degree be at his own option, and can be regulated by an attention to his resources. The rich may be extravagant, the poor can be frugal; and private oppression may always be avoided by a judicious selection of objects proper for such impositions.... If duties are too high, they lessen the consumption; the collection is eluded; and the product to the treasury is not so great as when they are confined within proper and moderate bounds.... Impositions of this kind usually fall under the denomination of indirect taxes, and must for a long time constitute the chief part of the revenue raised in this country. Those of the direct kind, which principally relate to land and buildings, may admit of a rule of apportionment.
Emergency Measure

It was a cardinal point to these discussions that the power of direct taxation through apportionment was to be exercised only to pay for debt incurred as a result of war, insurrection, or similar emergencies, but not for the normal operation of the federal government. That function was to be financed by indirect taxes alone. James Madison commented:

When, therefore, direct taxes are not necessary, they will not be recurred to.... It can be of little advantage to those in power to raise money in a manner oppressive to the people.... Direct taxes will only be recurred to for great purposes.... If this country should be engaged in war - and I conceive that we ought to provide for the possibility of such a case - how would it be carried on?... How is it possible a war could be supported without money or credit? And would it be possible for a government to have credit without having the power of raising money? No; it would be impossible for any government, in such a case, to defend itself. Then I say, sir, that it is necessary to establish funds for extraordinary exigencies, and to give this power to the general government.

To the Founding Fathers, the primary purpose of apportionment was to block the central government from using the power of direct taxation - except in times of great national emergency. The barrier was not in the formula of distributing the tax load among the states, but in the procedure for doing so. To lay a direct tax, Congress had to do certain things that no government wants to do. Since each tax is a separate project, each would have to be written into a revenue act. The purpose and the amount of the tax would have to be clearly stated, and then debated and voted upon. When the tax was collected, the revenue act would expire, and the door to more money would be closed.

How different this is from the ongoing power of general taxation, under which the purpose is seldom known, the amount is always in doubt, and the process is endless. The rule of apportionment, therefore, was the greatest restraint on the power and reach of government that had yet been devised by man, and it is little wonder that it became a thorn in the side of federal politicians in the years to follow.

Of course, the Uniform Apportionment Tax was not flawless. In truth, there can never be a perfect tax if the people cannot afford it. When Hamilton became the first Secretary of the Treasury, he persuaded Congress to authorize the nation's first indirect tax. It was an excise on whiskey, a few luxury items, auction sales, and negotiable instruments. It was excellent in theory, but it was a heavy tax - resulting in a whopping 25 percent increase in prices - and it led to a full-scale revolt. Rumors quickly spread that the government was about to extend these taxes to all articles of consumption, including food and clothing. This would be the European experience all over again. Excessive excise taxes were what had driven many immigrants to seek refuge in America. So it is not surprising that this first experiment was met with large-scale public resistance.

The biggest ruckus came from the Western farmers. Because there was a shortage of money along the frontier, it had become common to use whiskey as a medium of exchange. Grain was too bulky for transport, so the farmers grew rye, distilled it into whiskey, and moved their produce into national trade in that form. For the frontiersman, therefore, a tax on whiskey was not an excise tax or luxury tax at all. It was a 25 percent tax on their basic crop, and they complained that no other farmers and no other producers of manufactured goods had to pay a similar tax - which was quite true. By 1794 the entire region was in open revolt. Tax collectors were tarred and feathered and their houses were burned to the ground. When a judge of the Supreme Court declared a state of insurrection in western Pennsylvania, President Washington called out the militia from adjacent states and, in a show of force, led these troops in full-dress uniform.

Fortunately, military confrontation was averted: The rebels surrendered in return for amnesty, no one went to jail, and within a few months the excise tax was repealed.
First Direct Tax

In 1798, Congress levied its first direct tax. It was in the amount of $2 million and was apportioned among the states on the basis of the current census, which was also the basis for the number of representatives each state had in Congress. The purpose of the tax was to extinguish part of the debt incurred by the Revolutionary War. Reduction of the national debt was viewed as one of those rare emergencies that would justify resorting to the extreme measure of a direct tax. In this case, the tax was levied on dwellings, land, and slaves. It did not provide for any deductions or exemptions, but, sadly, it was progressive in nature, with larger homes paying more per $100 of value than others.

Herein lay one of the hidden flaws in the tax concept of the Founding Fathers. They had inherited the feudal concept of noblesse oblige, the obligation of noblemen to take care of their inferiors and assume greater responsibility of government. By 1776, however, especially in America, this concept had lost its virtue. In a republic such as ours, there is no justification for allowing class distinctions into the law - and that includes tax law. If one class can be exempted from taxes on the basis of class, rank, or wealth, then that same group can be singled out later for extra taxes on the same basis, depending merely on the political majority at the time. The principle of taxing those with wealth at a higher rate than others must have seemed harmless at the time - perhaps even humanitarian - but it was destined to fester into a huge boil that would torment Americans for many generations to come.

All of these issues aside, the fact remains that the first direct tax in the United States was entirely constitutional. Congress had stated the purpose and the amount. It had been debated and passed. Most important, once collected, the tax would expire. In spite of these constraints, however, the tax met with considerable resistance and, in fact, soon led to a second revolt, this one among German settlers along the Eastern Seaboard. Pennsylvania's quota of the $2 million tax was $273,000, which fell mainly on land and houses. The valuation of houses was estimated by counting the number and size of windows, a practice inherited from England. But when the tax assessors arrived, the German residents thought they were reviving the hated European hearth tax. They organized into small bands and set out to assault the assessors and drive them from the district, which they did in short order. When some of the rebels were arrested and put into prison, an auctioneer named John Fries led a march on the courthouse and freed them. President John Adams once again called out the militia. Fries was captured, tried, and convicted of treason, but later received a presidential pardon.
Early Decentralization

By the time Thomas Jefferson became President, the nation had already experienced two uprisings over taxes - small to be sure, but revolts nonetheless. Hamilton and Adams had wanted to forge ahead with a powerful central government, and for this they needed revenue. The political tide now turned back to Jefferson's views of limited government. In his first Annual Message, Jefferson urged repeal of all internal taxation and a return to a reliance on tariffs alone. He said:

Considering the general tendency to multiply offices and dependencies and to increase expense to the ultimate term of burden which the citizen can bear, it behooves us to avail ourselves of every occasion which presents itself for taking off the surcharge; that it may never be seen here that, after leaving to labor the smallest portion of its earning on which it can subsist, government shall itself consume the whole residue of what it was instituted to guard.

Jefferson was not just making a speech to please the voters. He followed through. He cut government spending to the bone and even put much of the Navy into drydock. Meanwhile, Treasury receipts from tariffs were growing rapidly with the expanding nation. Lower taxes left the consumer with more money to buy imported goods. Jefferson proved his point. At the end of his term, the government actually had a surplus and had accelerated repayment of the federal debt - all as a result of tariffs alone.

The second time a direct tax was levied in accordance with the apportionment requirements of the Constitution was in 1813, principally to pay for the War of 1812. Another direct tax was assessed two years later for the same purpose. The first was for $3 million and the second for $6 million. The terms of assessment and proportion among the states were similar to those of the first revenue act. One interesting variation, however, was that the states were given the option of levying the tax entirely on their own according to whatever method of distribution they wished, saving the federal government the expense of administering the project. The states could take a 15 percent discount if they paid within six months, and a ten percent discount if they paid within nine months.

The first part of the 19th century was a period of great growth and prosperity for the United States. Excise taxes had been repealed, and the debts of war had been repaid. By and large, the central government was weak regarding internal affairs, which meant that the people were strong. The bureaucracy stayed out of the way and let Americans get on with their lives. Commerce flourished, wealth was created, and the standard of living for the common man soared. The Old World watched in amazement and envy. Then, with the War Between the States, the long retreat from greatness began.

With the outbreak of war between the northern and southern states, there was urgent need on both sides for massive armies and equally massive funding. In the South, almost the entire amount was raised by fiat money - paper bills with no backing in gold or anything of tangible value. In the North, however, Congress struggled to raise revenue in accordance with the Constitution. War was exactly the kind of "exigency" foreseen by the Founding Fathers when they established the principle of apportionment. So on August 5, 1861, Congress enacted the nation's fourth direct-tax revenue bill for the stated amount of $20 million. It was similar to the previous bills except that this time slaves were no longer taxed as property - only land, "improvements," and dwellings. The big departure, however, was that it also contained a provision to tax incomes. Congress did not like the idea of having to get taxes on a piecemeal basis. It wanted a continual flow of income without having to justify its specific purpose and without stated amounts. It looked for a way to bypass the apportionment process.

But how? All direct taxes had to be apportioned. That is what the Constitution mandated. The solution was easy: Since an excise tax is an indirect tax and does not have to be apportioned, they simply redefined the income tax as an excise tax.
The "excise" tax was a flat three percent of all income over $800 a year. Considering that the per capita income at that time was only about $150, that was a substantial exemption. Putting aside the merits or demerits of an income tax in general, we are dealing here with the concept of exemptions from that tax. This is, once again, the feudal tradition of noblesse oblige, but under a slightly different form. It is directly contrary to the concept of taxation with representation. If some are exempt from the tax, for whatever reason, and if they continue to have representation, then those who do pay it are denied an increment of consent and representation which is in direct proportion to the exemption.

Inflation Tax
In retrospect, the war-emergency income tax proved to be a relatively unimportant source of revenue. By far the greater part came from government debt and fiat money, which, incidentally, also was contrary to clear provisions of the Constitution. The Lincoln Administration raised a total of about $2.7 billion in bonds and "greenbacks." The direct tax on property pulled in about $17 million. The income tax, over the ten-year period it remained in force, raised about $347 million. Wars are seldom financed out of tax revenue alone. Inevitably, they are funded by government debt, the monetization of which causes inflation - a form of taxation few people understand. Americans in the northern states paid, in addition to the property tax, a hidden tax of a full one-half of all their savings as a result of a 50 percent decline in the purchasing power of their money during that period.

America's first income tax was sold to the citizens as a temporary necessity, a wartime emergency. As such, it contained a date for its own termination. As is often the case in such matters, Congress managed to extend it a few years longer, but it finally did expire in 1872. By this time, however, the theories of Karl Marx were sweeping through the intellectual and educational institutions of America, and the populists were capturing political power. Politicians dreamed longingly of a permanent income tax because of the bountiful stream of revenue that would flow from it. But the masses also were fascinated with the progressive - or "graduated" - feature because it gave expression to their envy of the rich and salved their sense of hurt over high protective tariffs. Senator William Peffer of Kansas expressed this prevailing mood:

Wealth is accumulated in New York, and not because those men are more industrious than we are, not because they are wiser and better, but because they trade, because they buy and sell, because they deal in usury, because they reap in what they have never earned, because they take in and live off what other men earn.... The West and the South have made you people rich.
High Court Spike

With pressure from both the public and the politicians for a progressive income tax, who could stand in the way? But five men did do exactly that. They were Justices of the Supreme Court.

In 1893, President Grover Cleveland jumped on the populist bandwagon, asking Congress to lower tariffs and make up for lost revenue by taxing the income of corporations. The bill was expanded to include personal incomes as well and passed through Congress the following year. Before it even went into effect, however, it was declared unconstitutional by the Supreme Court. In the case of Pollack v. Farmer's Loan and Trust Co., the High Court declared that a tax is not lawful if it is levied on income from investments, because that would be the same as a tax on property. As such, it is a direct tax, which according to the Constitution must be levied in accordance with the rule of apportionment.

At the time of this ruling, the populists were in firm control of the Democratic Party and were making inroads into the Republican ranks as well. They castigated the Supreme Court as a tool of the rich and an enemy of the people. President Theodore Roosevelt advocated a progressive inheritance tax in 1906, and in his 1908 message to Congress called for a new income tax, suggesting that it be worded in such a way as to prevent the Supreme Court from striking it down. When William Howard Taft became President, the political winds were at gale force. It was no longer a question of if an income tax was to become law, only of how.

In April 1909, Senator Joseph Bailey, a wealthy Democrat from the South, introduced an income tax bill that he expected to be opposed by the Republicans. But the Republicans decided to steal the show by introducing a plan of their own. Under the leadership of Senator Nelson Aldrich of Rhode Island, and with the help of President Taft himself, they proposed an amendment to the Constitution as a means of circumventing the Supreme Court. It is sometimes claimed that these men were secretly opposed to an income tax and resorted to this stratagem merely to appease populist sentiment, while hoping that the amendment would never be ratified by three-fourths of the states. There is ample reason, however, to believe that they proposed the amendment because they truly wanted it.

Aldrich, in particular, is highly suspect in this role. His daughter, Abbey, was married to John D. Rockefeller Jr., and Aldrich was the man who arranged the secret meeting on Jekyll Island in Georgia in November 1910 that led to the creation of the Federal Reserve System. He also played a pivotal role in making sure that the income tax law did not apply to foundations. This made it possible to shift the tax burden to the middle class by allowing tax-exempt status to the great fortunes of such families as Rockefeller, Morgan, Carnegie, and Aldrich.

A Modern Serfdom

At the very least, it must be concluded that these men, sensing the unstoppable clamor for a soak-the-rich income tax, decided to run to the head of the parade, lead it away from Wall Street, and render the law harmless to themselves and their friends. It is not paranoia, however, to sense that there was more to it than that. It is quite possible that they represented a cabal of monetary and political scientists that planned the entire scenario and even helped create the public clamor that would serve as an excuse for their action. Their objective, in this more sinister view, would have been the creation of a modern serfdom with themselves as lords and masters. The serfs would be convinced of their self-importance by the delusions of representative government and the socialist tax that they honestly believed was to their benefit. The age-old dream of contented serfs would at last be realized.

The Senate approved the 16th Amendment by an astounding vote of 77 to zero! The House followed suit with a roll call of 318 to 14. The measure then went to the states for ratification. On February 12, 1913, the 42nd state voted for approval, and the following words became a part of the United States Constitution:
The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

Casting the Die
The 16th Amendment was sold to the people with solemn assurance that the income tax would be simple to compute, fair to all, and would never apply to any part of a person's income needed to sustain a decent standard of living. It was generally understood that only very large incomes derived from investments would be taxed, not the wages of the working man. That was, of course, a farce. The very first federal tax form issued in 1913 listed wages and salaries as income on which tax was to be paid.

The first tax was delicate by today's standards. After a whopping exemption on the first $4,000 of family income, the government took only one percent of the first $20,000, two percent at $50,000, and the highest rate was seven percent on incomes in excess of $500,000. These were all astronomical incomes in 1913, so it was only the very wealthy who paid any tax at all.

But the die was cast. Now that the federal government had a direct and perpetual access to the wealth of its citizens and no longer had to justify its financial needs through specific revenue acts, its spending began to rise like a hot-air balloon. With each round of spending came a reduction in the amount of exemptions, an increase in the tax rate, and a compounding of the complexity. At first it was the incomes of corporations; then of the very wealthy; then of the well-provided widow and the highly paid worker; and finally the wages of the janitor and the tips of waitresses.

No one in America fully understands the constantly changing Internal Revenue Code. Agents of the IRS do not, judges do not, congressmen do not, and most assuredly taxpayers do not.

When one considers the complexity of the tax code and the astronomical expense of operating the IRS itself, it is obvious that every other tax that has ever been tried in history is easier to compute and more efficient to collect than the income tax. And every time there is a tax "reform" bill rushed through Congress, the tax code always seems to emerge more complex and unfair than before. It is the nature of the beast.

The result of this reality is aptly described in the beginning of Prentice Hall's booklet, Research in Federal Taxation. Under the heading, "Opportunities Unlimited," it says:

Today's tax professionals face the prospect of the most promising future in the history of their profession.... With each passing year the federal tax laws affect American business and the individual taxpayer more and more. No businessperson, however expert in the business practices, can do without a tax advisor. He or she needs help on business transactions that have tax implications, because many daily business decisions are regulated to a degree by the tax consequences and results. And the great majority of taxpayers are becoming increasingly aware of the impact of the federal tax on their income and personal wealth. Their investments, provisions for retirement, wills, and business-connected (or sometimes even personal) expenditures require tax planning.

America has become infested with a swarm of tax professionals who are a drain on every business and private transaction that occurs. A significant part of everything we purchase goes to pay for a vast workforce of bookkeepers and accountants who must maintain reams of records to substantiate every cost of doing business, while producing nothing to expand the physical or cultural well-being of the nation.
Retarding the Economy

In the long run, any income tax, even one that is based on the same percentage for everyone, will serve to lessen the incentive to produce and, thus, will retard the nation's economic growth - which, in turn, will lower everyone's standard of living.

One of the most powerful advocates of this idea in 1879 was Henry George, better known for his advocacy of a single tax on land. We do not have to agree with his thesis on the single tax to appreciate the wisdom of his opposition to a direct tax on income or personal property. In his treatise Progress and Poverty, George wrote:
If I have worked harder and built myself a good house while you have been contented to live in a hovel, the tax-gatherer now comes annually to make me pay a penalty for my energy and industry by taxing me more than you. If I have saved while you wasted, I am [milked] while you are exempt.

If a man built a ship, we make him pay for his temerity as though he had done an injury to the state; if a railroad be opened, down comes the tax collector upon it as though it were a public nuisance.... We punish with a tax the man who covers barren fields with ripening grain; we fine him who puts up machinery and him who drains a swamp.

To abolish these taxes would be to lift the whole enormous weight of taxation from productive industry.... The state would say to the producer, "Be as industrious, as thrifty, as enterprising as you choose. You shall have your full reward!"
Since the income tax was created in 1913, it has been a long, bumpy ride and the American people have been jarred into a state of annoyance. We no longer are misty-eyed over political rhetoric that promises a utopia to be paid for by someone else. We have learned the hard way that there is no free lunch. Our "lunch," in fact, has cost us a fortune.

It has been necessary to review some history and taxation theory in order to come to an understanding of how we got to where we are and, most important, to learn from the mistakes of the past. Hopefully the information presented here will help crystalize the thinking of those who are opinion leaders. But specific proposals must be constructed in such a way as to have broad, immediate appeal to the American public. With that objective in mind, let us turn, finally, to what now must be done to restore tax sanity to our government.

Presidential candidate Steve Forbes has made his "flat-tax" plan a major campaign issue. A flat-rate income tax is certainly an improvement over a graduated income tax. But if a flat-rate tax were adopted, it still would be a direct tax and would still allow Congress to have continual access to our pocketbooks without ever having to explain or justify why it needed the money. Tax reform will never become a reality until Congress is once again required to live within a modest means - as would automatically happen if it had to depend only on indirect taxes - or, if extraordinary revenue is wanted, to specify the exact amount and to justify it in a specific revenue act.

Eliminate the Income Tax
The flat-tax plan is not the answer. What we need is to follow the greatest proposal for tax reform the world has ever seen, and it is already in our Constitution. What we need is to take the chains off the rule of apportionment and put them back where they belong, on the Congress of the United States. What we need is to repeal the 16th Amendment.

This single act would accomplish almost everything the current proposals for tax reform claim to seek. For the first time since 1913, the federal government would have to prepare a realistic budget, because it would no longer be able to rely on an ongoing, limitless supply of revenue. Like the rest of us, it would have to live within its means, which would be from indirect taxes only. If it exceeded this budget, it would have to face the voters with a specific request for a specific amount on a specific date. It is difficult to conceive of a more effective plan for trimming the scope and reach of the federal bureaucracy. It would be necessary to scrutinize the budget to try to discover the hidden boondoggles and subsidies. Cut back the funds, and these automatically would wither away. The rule of apportionment is the only realistic answer.

Yes, we are talking about the elimination of the income tax. Many people would naturally ask, "But where would the money come from to run the government?" This question presupposes that all the money the federal government now receives is necessary. The reality is that - if we were to cut out the waste, subsidies, foreign giveaways, transfer programs, interest on the national debt, transfusions into the International Monetary Fund, and support for the World Bank, plus the cost of running the IRS itself - the federal government could easily operate, as it was intended to do, on indirect taxes alone. Many important sources of revenue would not be affected by apportionment, most specifically tariffs (for revenue only, not for subsidizing a politically favored industry) and such excises as a gasoline tax for the maintenance of roads, fees for admission to national parks, postage stamps for the operation of the post office, and similar items. It is totally workable.

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States to feds: Stay in D.C.!$11 trillion 'micromanaging' price sparks explosion in sovereignty movement
© 2009 WorldNetDaily

A movement to reclaim for states all rights not specifically designated to the federal government in the U.S. Constitution is exploding across the nation, with 35 states already acting or at least considering such proposals – and one state lawmaker estimating the nation as a whole could save $11 trillion in coming years if it would succeed.

WND reported not long ago when the number of states with lawmakers considering such sovereignty efforts reached 20.

Now, according to the Tenth Amendment Center, such provisions have been launched in at least 35 states. They all address the Tenth Amendment that says: "powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people."

South Carolina's S. 424 is an example. It is titled: "To affirm South Carolina's sovereignty under the Tenth Amendment to the United States Constitution over all powers not enumerated and granted to the federal government by the United States Constitution."

Essentially it's a reminder that the United States is made up of individual states; it's not a federal authority broken up into political subdivisions.

In South Carolina, the proposals remains pending in the state Senate, where Sen. Lee Bright said he still hopes that it will be adopted this year.
The proposal there notes specifically that the "federal government was created by the states … to be an agent of the states," and the states currently "are treated as agents of the federal government," many times in violation of the Constitution.

The resolution states:

Be it resolved by the Senate, the House of Representatives concurring: That the General Assembly of the State of South Carolina, by this resolution, claims for the State of South Carolina sovereignty under the Tenth Amendment to the Constitution of the United States over all powers not otherwise enumerated and granted to the federal government by the United States Constitution.Be it further resolved that all federal governmental agencies, quasi-governmental agencies, and their agents and employees operating within the geographic boundaries of the State of South Carolina, and all federal governmental agencies and their agents and employees, whose actions have effect on the inhabitants or lands or waters of the State of South Carolina, shall operate within the confines of the original intent of the Constitution of the United States and abide by the provisions of the Constitution of South Carolina, the South Carolina statutes, or the common law as guaranteed by the Constitution of the United States.
Bright told WND the movement is spreading from state to state as fast as lawmakers discover it.
Michael Boldin, a spokesman for the Tenth Amendment Center, said his organization has created a posting for all such proposals to be tracked.

Among the states where such proposals at least have been considered are Louisiana, Colorado, Wisconsin, Illinois, West Virginia, North Carolina, North Dakota, Ohio, Nevada, Oregon, Alabama, Mississippi, Pennsylvania, Idaho, New Mexico, South Dakota, Virginia, Kentucky, Alaska, Indiana, Tennessee, Arkansas, Minnesota, South Carolina, Georgia, Kansas, Texas, New Hampshire, Missouri, Iowa, Montana, Michigan, Arizona, Washington and Oklahoma.
In North Dakota, it passed the House and Senate both in April, with the House a short time later adopting changes made by the Senate.

In South Dakota, it was approved by both houses of the Legislature and under that state's rules does not need the governor's signature.

Just last week, Rep. M.J. "Manny" Steele, a Republican in South Dakota, wrote that he believes up to $11 trillion is being wasted in the coming years by Washington's efforts "to duplicate and micromanage our states' affairs."

He said states should manage their own affairs and not be dependant on a federal cash cow to make ends meet. Likewise with industries, he said, citing federal cash dumps on the banking, insurance and automobile industries.

After all, he agreed, with enough federal money allocated to the industry, Americans all still could be listening to 8-track tapes in their cars, but would that really be the best outcome?
Steele told WND his dollar estimate was based on what President Obama himself has allocated in the coming years to spend on stimulus packages, industry bailouts and the like.
"If we would just let the market take care of these things," he said.

His letter noted that Alaska, Georgia, Idaho, Missouri, North Dakota, Oklahoma and South Carolina legislatures joined South Dakota's in passing some statement on the Tenth Amendment this year. The results vary based on state procedures, however. In Oklahoma, the governor vetoed the plan and it was launched on its second trip through the legislature.
"Over the course of decades, there have been increasing federal mandates and acts designed to effectively step in and legislate the affairs of our various states from Washington D.C.," Steele said. "Federal usurpation into state affairs severely limits the ability of state governments to operate according to their citizens' wishes."

Citizens should be driving this from the grassroots, claim your Sovereignty! Get the LibertyLetter.

The spirit of Tax Protest & Tea Parties

This is only my opinion, but it seems to me that for as long as you are convinced that permission is needed from some great high authority, American Liberty will be in peril. Our foundation is that we are the authority, it seems that we need to re-learn that and explain it to our hired help in Washington D.C. In my experience with this subject, it seems that there are two things that no one wants to do, regardless of their position. One is to give permission, and the other is to make a determination.

It appears to me that if the Congress or IRS really had the great authority that they are credited with, they would not be so dependant on OUR determination.
It only demonstrates that we, are the authority. This is what it comes down to, each must make their own decision and determination, it is nothing different from what you are already doing. It's just that the determination you are already making is probably costing your future.

It makes me sick to hear a politician make a statement along the lines of  "we can't let people provide for their own retirement". We elect a representative and all of a sudden we have an expert/daddy deciding what is best for us concerning our own lives. When did the role change? It changed when "We the People" abdicated our responsibility for self governance. See, that is the way that it works, if you don't make the determinations for your own life, some self-interested politician will be glad to do it for you, or coerce you to yield your authority. And if you let it go on long enough, you then are hearing about what else they can't "let" you, in regard to your own life... because they know best.

But, our determination seems to be very much needed. You don't need to sign a form every time you buy a tank of gas and pay excise tax on each gallon. Could it be that you already authorized that tax via a properly executed law?

The USA has, from the very beginning, stood in defiance of a world that would withhold permission. It seems ironic that we, the children of rebellion, would now put so much into asking or seeking permission for what we should be able to determine on our own. Our forefathers held with what they determined to be right as individuals, and they collectively stayed the course to base our Republic on a foundation of self governance by law of the people.

Both their brilliance and humility are evidenced in the perfection that they left in our Constitution. The only thing that they could not fix would be our determination to keep it. Maybe that is as it should be.

The spirit of the times may alter, will alter. Our rulers will become corrupt, our people careless. A single zealot may become persecutor, and better men be his victims. It can never be too often repeated, that the time for fixing every essential right, on a legal basis, is while our rulers are honest, and ourselves united. From the conclusion of this war (revolution) we shall be going down hill. It will not then be necessary to resort every moment to the people for support. They will be forgotten, therefore, and their rights disregarded. They will forget themselves, but in the sole faculty of making money, and will never think of uniting to effect a due respect for their rights. The shackles, therefore, which shall not be knocked off at the conclusion of the war, will remain on us long, will be made heavier and heavier, till our rights shall revive or expire in a convulsion.

There are two subjects which I shall claim a right to further as long as I have breath: the public education and the subdivision of the counties into wards (townships). I consider the continuance of Republican government as absolutely hanging on these two hooks. Where every man is a sharer in the direction of his ward republic or of some of the higher ones, and feels that he is a participator in the government of affairs, not merely at an election one day in the year, but every day; when there shall not be a man in the State who shall not be a member of some one of its councils, great or small, he will let the heart be torn out of his body sooner then his power be wrested from him by a Caesar or Bonaparte.
Thomas Jefferson

If you are afraid, stop and feel the fear as much as you can. While it is with you, ask yourself if it could possibly be right that you are living in a country founded on the principles of freedom, Liberty, and the Sovereign rights of the people, yet you stand in fear of its government. While so many gave their very lives to secure these unalienable rights to this great nation, you have only to stand up to secure them to yourself and your posterity. If you will, you will learn that fear is a powerless jailer.

If you are still a little squeamish about the thought of actually applying this information, think about what is the worst that could happen. If you are already a taxpayer, as far as you know, what's the harm in having the government prove it? If you had required them to prove it in the first place, you might not have been a taxpayer for all of this time.

It is my hope that you will find this information useful. And, that you use it to your advantage and benefit. There is always some risk in setting aside fear to stand up for your right, take courage, for the benefit of having rights far outweigh that risk. Our rights have been won for us, it falls to us to retain them, in honor of those that have gone before.

Thomas Jefferson - The spirit of a free America

"What country can preserve its liberties if its rulers are not warned from time to time that their people
preserve the spirit of resistance? Let them take arms. The remedy is to set them right as to facts,
pardon and pacify them." --Thomas Jefferson to William Stephens Smith, 1787. ME 6:373, Papers
12:356

"Governments, wherein the will of every one has a just influence... has its evils,... the principal of which
is the turbulence to which it is subject. But weigh this against the oppressions of monarchy, and it
becomes nothing. Malo periculosam libertatem quam quietam servitutem. [I prefer the tumult of liberty
to the quiet of servitude.] Even this evil is productive of good. It prevents the degeneracy of
government, and nourishes a general attention to the public affairs." --Thomas Jefferson to James
Madison, 1787. ME 6:64

"The spirit of resistance to government is so valuable on certain occasions, that I wish it to be always
kept alive. It will often be exercised when wrong, but better so than not to be exercised at all. I like a
little rebellion now and then. It is like a storm in the atmosphere." --Thomas Jefferson to Abigail
Adams, 1787.

"God forbid we should ever be twenty years without such a rebellion... We have had thirteen States
independent for eleven years. There has been one rebellion. That comes to one rebellion in a century
and a half, for each State. What country before ever existed a century and a half without a rebellion?"
--Thomas Jefferson to William S. Smith, 1787. ME 6:372

"Most codes extend their definitions of treason to acts not really against one's country. They do not
distinguish between acts against the government, and acts against the oppressions of the government.
The latter are virtues, yet have furnished more victims to the executioner than the former, because
real treasons are rare; oppressions frequent. The unsuccessful strugglers against tyranny have been
the chief martyrs of treason laws in all countries." --Thomas Jefferson: Report on Spanish Convention,
1792.

"If our country, when pressed with wrongs at the point of the bayonet, had been governed by its heads
instead of its hearts, where should we have been now? Hanging on a gallows as high as Haman's."
--Thomas Jefferson to Maria Cosway, 1786. ME 5:444

"The commotions that have taken place in America, as far as they are yet known to me, offer nothing
threatening. They are a proof that the people have liberty enough, and I could not wish them less than
they have. If the happiness of the mass of the people can be secured at the expense of a little tempest
now and then, or even of a little blood, it will be a precious purchase. 'Malo libertatem periculosam
quam quietem servitutem.' Let common sense and common honesty have fair play, and they will soon
set things to rights." --Thomas Jefferson to Ezra Stiles, 1786. ME 6:25

"The tumults in America I expected would have produced in Europe an unfavorable opinion of our
political state. But it has not. On the contrary, the small effect of these tumults seems to have given
more confidence in the firmness of our governments. The interposition of the people themselves on the
side of government has had a great effect on the opinion here [in Europe]." --Thomas Jefferson to
Edward Carrington, 1787. ME 6:57

"The late rebellion in Massachusetts has given more alarm than I think it should have done. Calculate
that one rebellion in thirteen states in the course of eleven years, is but one for each state in a century
and a half. No country should be so long without one. Nor will any degree of power in the hands of
government prevent insurrections." --Thomas Jefferson to James Madison, 1787. ME 6:391

"[An occasional insurrection] will not weigh against the inconveniences of a government of force, such
as are monarchies and aristocracies." --Thomas Jefferson to T. B. Hollis, July 2, 1787. (*) ME 6:155

"Cherish... the spirit of our people, and keep alive their attention. Do not be too severe upon their
errors, but reclaim them by enlightening them." --Thomas Jefferson to Edward Carrington, 1787. ME
6:58

Misdirected Resistance

"There are extraordinary situations which require extraordinary interposition. An exasperated people
who feel that they possess power are not easily restrained within limits strictly regular." --Thomas
Jefferson: Rights of British America, 1774. ME 1:196, Papers 1:127

"[The] uneasiness [of the people] has produced acts absolutely unjustifiable; but I hope they will
provoke no severities from their governments. A consciousness of those in power that their
administration of the public affairs has been honest may, perhaps, produce too great a degree of
indignation; and those characters wherein fear predominates over hope, may apprehend too much from
these instances of irregularity. They may conclude too hastily, that nature has formed man
insusceptible of any other government than that of force, a conclusion not founded in truth nor
experience." --Thomas Jefferson to James Madison, Jan. 30, 1787. ME 6:64

"The arm of the people [is] a machine not quite so blind as balls and bombs, but blind to a certain
degree." --Thomas Jefferson to William Short, 1793. ME 9:10

"I hold it that a little rebellion, now and then, is a good thing, and as necessary in the political world as
storms are in the physical. Unsuccessful rebellions, indeed, generally establish the encroachments on
the rights of the people, which have produced them. An observation of this truth should render honest
republican governors so mild in their punishment of rebellions, as not to discourage them too much. It is
medicine necessary for the sound health of government." --Thomas Jefferson to James Madison, 1787.
ME 6:65

"[No] degree of power in the hands of government [will] prevent insurrections." --Thomas Jefferson to
James Madison, 1787. Papers 12:442.

"The boisterous sea of liberty is never without a wave." --Thomas Jefferson to Richard Rush, 1820.
ME 15:283

"What signify a few lives lost in a century or two? The tree of liberty must be refreshed from time to
time with the blood of patriots and tyrants. It is its natural manure." --Thomas Jefferson to William
Stephens Smith, 1787. ME 6:373, Papers 12:356

Rebellion, Right and Wrong

"Whenever any form of government becomes destructive of these ends [i.e., securing inherent and
inalienable rights, with powers derived from the consent of the governed], it is the right of the people to
alter or abolish it, and to institute new government, laying its foundation on such principles, and
organizing its powers in such form, as to them shall seem most likely to effect their safety and
happiness." --Thomas Jefferson: Declaration of Independence, 1776. ME 1:29, Papers 1:315

"In no country on earth is [a disposition to oppose the law by force] so impracticable as in one where
every man feels a vital interest in maintaining the authority of the laws, and instantly engages in it as in
his own personal cause." --Thomas Jefferson to Benjamin Smith, 1808. ME 12:62

"In a country whose constitution is derived from the will of the people directly expressed by their free
suffrages, where the principal executive functionaries and those of the legislature are renewed by them
at short periods, where under the character of jurors they exercise in person the greatest portion of the
judiciary powers, where the laws are consequently so formed and administered as to bear with equal
weight and favor on all, restraining no man in the pursuits of honest industry and securing to every one
the property which that acquires, it would not be supposed that any safeguards could be needed against
insurrection or enterprise on the public peace or authority. The laws, however, aware that these should
not be trusted to moral restraints only, have wisely provided punishments for these crimes when
committed." --Thomas Jefferson: 6th Annual Message, 1806. ME 3:418

"As revolutionary instruments (when nothing but revolution will cure the evils of the State) [secret
societies] are necessary and indispensable, and the right to use them is inalienable by the people; but
to admit them as ordinary and habitual instruments as a part of the machinery of the Constitution,
would be to change that machinery by introducing moving powers foreign to it, and to an extent
depending solely on local views, and, therefore, incalculable." --Thomas Jefferson to William Duane,
1803. FE 8:256

"The paradox with me is how any friend to the union of our country can, in conscience, contribute a
cent to the maintenance of anyone who perverts the sanctity of his desk to the open inculcation of
rebellion, civil war, dissolution of government, and the miseries of anarchy." --Thomas Jefferson to
William Plumer, 1815. ME 14:235